the basic model for valuation of firm is the dividend discount model (ddm). when investors buy stocks, they expect to receive two types of cash flow: dividend in the period during which the stock is owned, and the expected sales price at the end of the period. in the extreme example, the investor keeps the stock until the company is liquidated; in such a case, the liquidating dividend becomes t...

The purpose of this study is to investigate the dynamic dividend policy of the firms in Korea. In particular, this study empirically tests whether Korean firms follow stable dividend policies as in developed markets where dividend smoothing is a stylized fact. The paper also identifies firm-level factors that influence the degree of dividend smoothing. For this purpose, 299 firms listed on Kore...

Abstract In this paper, we model the insurance company’s surplus by a compound Poisson risk model, where process can only be observed at random observation times. It is assumed that insurer observes its level periodically to decide on dividend payments and capital injection interobservation time having an $\operatorname{Erlang}(n)$ <mml:...

Using fluctuation theory, we solve the two-sided exit problem and identify the ruin probability for a general spectrally negative Lévy risk process with tax payments of a loss-carry-forward type. We study arbitrary moments of the discounted total amount of tax payments and determine the surplus level to start taxation which maximises the expected discounted aggregate income for the tax authorit...

Many studies find that households increase their consumption after the receipt of expected income payments, a result inconsistent with the life-cycle/permanent income hypothesis. Consumption can increase adverse health events, such as traffic accidents, heart attacks and strokes. In this paper, we examine the short-term mortality consequences of income receipt. We find that mortality increases ...

In this paper we investigate the optimal risk control and dividend distribution problem for a diffusion model with a terminal value. Usually the insurer cedes risk by means of a reinsurance contract, and pays dividends out dynamically from the surplus. Consider that the insurer is trying to balance risk control and dividend payout in terms of reinsurance and dividend distribution policies. Then...

Abstract Dividend payments are firm events on a recurring and predictable basis. High returns in the period between announcement-date ex-dividend date main driver for so-called dividend month premium, which positive abnormal months corporations predicted to issue payments. In our empirical analysis of German stock market, we find robust is particularly high stocks with surprise. Knowing dates a...

We propose a model in which dividend payments occur at regular, deterministic intervals an otherwise continuous model. This contrasts traditional models where either the payment of dividends is controlled or dynamics are given by discrete time processes. Moreover, between two payments, structure allows for other types control; we consider possibility equity issuance any point time. The value ch...

This paper deals with optimal dividend payment problem in the general setup of a piecewise-deterministic compound Poisson risk model. The objective of an insurance business under consideration is to maximize the expected discounted dividend payout up to the time of ruin. Both restricted and unrestricted payment schemes are considered. In the case of restricted payment scheme, the value function...